Australian ECA gives 80X more to fossil fuel projects than renewables

(Guardian, Sydney, 6 July 2021) Australia’s export credit agency provided more than $1.5bn in finance to fossil fuel projects between 2009 and 2020, about 80X what it spent on renewables, according to a new report from Jubilee Australia. Over the same 11-year period, covering the hottest years on record globally, it provided $20m in support to renewables projects. Luke Fletcher, executive director of Jubilee Australia, argues that EFA’s support for fossil fuel projects “bucks the international trend”, risks investing in doomed projects and curtails opportunities for the country’s energy sector to modernise. Export Finance Australia has also been criticized for taking on a role as a Development Finance Institution (DFI), adding equity stakes in risky overseas infrastructure to its export insurance and lending powers in order to to compete with Chinese, Japanese and Korean ECAs. For some, this sort of reform blurs the distinction between the government and the private sector, and at worst is a form of corporate welfare, blurring the line between helping developing countries vs Australian business. Australia is the world’s largest exporter of coal and gas, yet producers in those sectors are finding it increasingly difficult to source financing from commercial lenders.